Farming in the Shadow of Suburbia

Agriculture in New England has been closely intertwined
with urban development. In the early nineteenth century, small
family-owned farms spread throughout the region's river valleys
following the establishment of industrial mills and towns.
They provided food, wool, and leather for the neighbors and
also etched themselves deeply into our regional character,
along with white-steepled churches and town meetings. The
rural landscape, with its patchwork of neat farmhouses, stone
walls, and hills dotted with cows, became ingrained in our
local identity and imagination.

As the pace of industrial and urban development quickened,
especially after World War II, the relationship between farm
and town became more complex. Cities that earlier had provided
the impetus for agricultural expansion began to encroach on
rural areas, raising property values and diverting labor to
higher-paying jobs in town. Competition from imports, both
domestic and from around the world, intensified the pressures.
Farms and acreage devoted to farming declined sharply, with
only the most fertile -- or best located -- areas persisting
in agricultural use. Today almost half of the remaining New
England farms and more than one-third of farm acreage are
located within a stone's throw of significant population centers.
As a Lincoln Land Institute study observed, much of the region's
surviving farmland now lies in "the shadow of suburbia."

New England farmers take advantage of their proximity to
urban markets, offering perishable and high-value products
that maximize the return on the land. But the pressures of
high land prices and the lure of city wages remain. And as
the number of farms declines, crucial suppliers of seed and
equipment may leave for less congested locations.

Many of the region's residents hope that farming will not
be pushed out altogether, but will be able to coexist with
surrounding metropolitan communities. Environmentalists have
surfaced as farmers' sometimes allies, along with others who
care about the preservation of open space. Farms create the
rural vistas and variety in the landscape that bring visitors
to the region. They also give New Englanders a strong sense
of place, notes Holly Dominie, a landscape architect from
Readfield, Maine, one that is rich in meaning, conjuring up
a safe and readily understood world, with distinct boundaries,
centered on family and community values.

THE PRICE OF FARMLAND

Agriculture was a growth industry in New England throughout
the middle of the nineteenth century. Between 1850 and 1880,
the number of farms rose by more than 20 percent and agriculture
occupied more than half the region's land area. The landscape
was cleared for miles in heavily forested Maine. In New Hampshire,
farms expanded into such unlikely locations as partway up
Mount Monadnock.

After 1880, the development of the railroads and refrigeration
made it cheaper to import food from areas with more hospitable
climate and soil. Improved farm machinery and other new techniques
created economies to large-scale agricultural production.
These circumstances favored the flat topography of the Midwest,
whereas New England's smaller holdings, patchwork ownership
patterns, and rocky, rolling landscape inhibited consolidation
into larger, more productive enterprises. As farmers elsewhere
were able to produce ever more, at lower cost, U.S. farm acreage
and average farm size grew larger, while the number of farms
dropped. In New England, farmers saw a steep drop in both
farms and acreage, as their income often did not cover costs.
Many farms were simply abandoned as cultivated land and returned
to forest.

Since World War II, the price of much of New England's surviving
farmland has soared because of its growing value for housing
or commercial development. Rising incomes, which led to increased
spending on nonfood items as compared to food products, spurred
more commercial enterprise and the expansion of suburbia farther
into the countryside. Agricultural land, which had already
been cleared and graded, grew ripe for development.

Today, New England contains some of the highest-priced agricultural
land in the country, reflecting the dense population and the
value of land in alternative, nonfarm uses. While the average
U.S. farm was valued at $832 per acre (including buildings)
in 1995, the average value in New England ranged from $1,245
in Maine to $6,947 in Rhode Island. Rising land values and
urban development also tend to drive up property taxes. Even
though much agricultural land is taxed at a lower rate than
other commercial property, New England farmers paid average
property taxes ranging from $11 per acre in Maine to $57 in
Rhode Island, far in excess of the U.S. average of $6.

High land prices put intense pressure on the region's farms
to generate incomes that are substantial enough to justify
keeping the land in agriculture. Some farmers only partially
succeed, maintaining their farms as "rural residences,"
not so much for commercial viability as out of personal commitment
and the satisfactions of farm life. About two-thirds of the
region's farms, accounting for about 40 percent of agricultural
acreage, generate revenues under $25,000 per year.

But many are substantial commercial ventures. These farmers
have adapted to their metro-area location by producing for
local markets, often specializing in items that are perishable
or costly to transport. Thus, almost 30 percent of New England's
total agricultural cash receipts comes from milk, with over
half that revenue generated in Vermont. Another 20 percent
comes from fruits and vegetables, including Maine potatoes
and Massachusetts cranberries, which account for one-fifth
of the two states' receipts. Christmas trees, greenhouses,
and nurseries generate another 20 percent, and almost two-thirds
of sales in Rhode Island. In contrast, livestock (including
poultry, but not eggs) accounts for less than 8 percent of
revenues.

A number of farmers, noting rising urban incomes and growth
in gourmet and organic food stores, now produce high-value,
niche products. One grower raises shiitake mushrooms in an
abandoned textile factory in North Adams, Massachusetts; another
farms red deer in Vermont. Aquaculture has boomed, with salmon
from Maine and oysters from Connecticut leading the way. Many
growers supplement traditional revenues, and boost their return
per acre by adding special services and processing. They produce
exotic cheese, gourmet potato chips, and fancy maple syrup
that generate high prices and high margins. Although statistics
are not collected specifically on niche farms, Aubrey Davis
of the New England Agricultural Statistics Service believes
that their numbers are on the rise.

RISE AND DECLINE

New England Farms

Number of Farms

Farm Acreage

Farm Acreage

Farm Land As Percent
of Total Land

1850

167,700

18,367,000

110

46

1880

207,200

21,484,000

104

53

1940

135,200

13,371,000

99

33

1960

56,900

9,316,000

164

23

1970

28,600

5,600,000

196

14

1990

28,900

4,621,000

160

11

* Total land includes
dry land and land temporarily or partially covered by
water.

Sources: HISTORICAL STATISTICS
OF THE STATES OF THE UNITED STATES, TWO CENTURIES OF THE
CENSUS, 1790-1990 and STATE AND METROPOLITAN AREA DATA
BOOK 1991, U.S. Bureau of the Census.

FEEDING THE LOCALS

Nothing evokes autumn in New England more
than a crisp, tart apple, especially a McIntosh, for which
New England has the ideal climate. And the region's high population
density makes for a sizable market for local growers. Yet
even with these advantages, growing apples in the shadow of
suburbia creates special problems.

For starters, high land prices make it difficult
for smaller growers to expand when that would be the profitable
strategy. Small growers could once make a living selling to
mom-and-pop stores and small (two- and three-store) chains,
but now most apples are sold through large grocery chains.
This puts a premium on farm size, since large chains will
buy only from farmers who can deliver several thousand bushels
a week. Many chains also want their apples waxed and individually
stickered, which requires special equipment that smaller orchards
find expensive.

These issues present few problems for large
growers like Woodmont Orchards. Woodmont, owned and operated
by Bob Lievens, his brother Stephen, and their father, William,
was started during the Great Depression by William's dad in
Hollis, New Hampshire. Over the years, the family increased
its land holdings and added packing facilities as business
prospered. Woodmont now consists of three orchards, each about
two hundred acres: the original farm in Hollis, an orchard
in Londonderry, and another in Lyndeborough. The Lievenses
grow mostly Macs, but also Cortland, red and yellow Delicious,
and a few other varieties. During peak season, they can pack
and ship up to five thousand bushels a week.

But today's high land prices make it expensive
and difficult for smaller growers who want to consolidate
and increase production. And expansion is next to impossible
at any reasonable price once all the nearby land has been
developed. For example, the Lievens' Londonderry farm is hemmed
in on the north and west by housing subdivisions, on the south
by commercial development, and on the east by I-93 and Derry.

So small and middle-sized growers, like
Erick and Sue Leadbeater, often struggle to stay in business.
The Leadbeaters own and run Gould Hill Orchards, about one
hundred acres atop three hills in Contoocook, New Hampshire
just outside of Concord, with clear views all the way to Mount
Washington. They grow more than eighty varieties, including
a "heritage" orchard of antiques and their own Hampshire
apple, patented several years ago. Waxing and stickering machines
are not profitable at their production volume, so they sell
80 percent of their harvest through a packing house, reducing
already thin margins.

Like many smaller growers, the Leadbeaters
have been able to stay afloat partly because of urban consumers'
growing interest in fresh, high-quality produce. Each year,
hundreds of schoolchildren traipse through Gould Hill for
an educational tour, a hayride, and a chance to make cider.
Nursing homes bring residents to their wheelchair-accessible
orchard for pick-your-own. The Concord planetarium recently
delivered five hundred sky gazers to their hilltops to view
a lunar eclipse. One well-heeled party of ten even arranged
for a gourmet dinner, served at sunset under apple blossoms.

Most visitors stop by the farmstand to buy
apples and other produce. The store, managed by the Leadbeaters'
daughter and her husband (former restaurant owners and chefs
for the gourmet dinner), stocks a variety of apple-related
products, including pies, cider, jelly, T-shirts with the
Gould Hill logo, and even luxurious Persian rugs depicting
the indigenous apple orchards of Kazakhstan.

Such efforts to supplement traditional revenue
sources have been especially helpful to well-located farmers
within reach of a critical mass of tourists. Over the past
decade, the average revenue from direct sales has risen almost
20 percent for those New England farms that sell direct. Several
states have begun to encourage the links between agriculture
and tourism; Massachusetts is compiling a directory for travelers
who might want to visit, or stay overnight, on participating
working farms. Local communities have set up weekly farmers'
markets. One grower near the Lievenses is reducing his apple
production to what he can sell direct, and is using the freed-up
land to expand into other crops and extend the pick-your-own
season. The downside is that now he will be dependent on good
weather not just during the growing season, but also during
the weekends when the fruit is ready to pick.

Meanwhile, all producers face furious competition
from apples grown outside the region, including new and exotic
varieties such as Fujis and Galas imported from New Zealand
and Australia. Bob Lievens says that the growing availability
of all kinds of fruit from the Southern Hemisphere has put
a significant crimp in the supermarket shelf space allotted
to local apples during the winter. Washington State has also
become an apple powerhouse, with centralized packing facilities
and corporate orchards as large as one thousand acres. Washington
now produces five billion pounds of apples each year, more
than half of all apples grown in the United States. There,
growers combine forces to promote, market, and fund research;
they pay in 25 cents for every 42-pound box of apples sold,
giving them enormous marketing clout. Many New England-based
grocery chains even run radio spots that feature Washington
apples.

NICHE FARMING EXPANDSCash receipts, New
England

1995

1970

GAINERS (GROWING
SHARE)

Millions
of Dollars

Percent
of Total

Percent
of Total

Christmas
trees/greenhouse/nursery*

441

21

7

Vegetables
other than potatoes

135

6

4

Aquaculture

127

6

1

Cranberries

81

4

1

Other fruits
and berries

49

2

1

Hay

35

2

1

Livestock
other than cattle, pigs, sheep

31

2

<1

Maple syrup

17

1

<1

LOSERS (DECLINING
SHARE)

Milk

601

29

37

Eggs

212

10

16

Potatoes

105

5

10

Tobacco and
other crops

95

5

5

Cattle, pigs,
sheep

91

4

6

Apples

46

2

3

Poultry

33

2

8

* 1970 does not include
Christmas trees.
Source: New England Agricultural Statistics Service and
author's calculations from state estimates.

AVAILABILITY OF FARM INPUTS

Farming near an urban population also affects
the availability of farm labor and other crucial inputs. City
wages tend to be higher than pay in rural areas, even after
accounting for education level, finds Stanford economist Edward
Lazear. Thus, higher-wage jobs in town tend to lure the young
and best-educated workers. For New England apple growers,
finding pickers during the harvest season has become increasingly
difficult, and many, including the Lievenses, rely on migrant
workers from Jamaica brought to the region under a special
federal program during the seven-week harvest season.

But some families find that off-farm employment
possibilities in town operate to their advantage. Sue Leadbeater,
for example, works for a local accountant during income-tax
season. And many farm households are sustained by one or more
members who have other jobs. In fact, fewer than half of all
New England farmers claim farming as their principal occupation.
A substantial number depend on off-farm income to survive.

Others worry that high land prices, urban
traffic congestion, and a decline in the number of farms will
cause specialized suppliers of feed, fertilizers, and seed
to leave the area. A reduction in vendors, notes Douglas DiMento
of the New England dairy cooperative Agri-Mark, may result
in higher prices charged by the few equipment dealers and
repair services that remain. The loss of suppliers also fuels
uncertainty. And uncertain farmers may hesitate to invest
in new structures, better drainage systems, or improved machinery
and technology. In this way, farm decline can become a self-fulfilling
prophecy.

Still, urban development and high land prices
have their benefits. Many, like the Leadbeaters, have weathered
a bad year by selling off a small parcel. Others have used
the proceeds from a marginal plot to send a child to college
or to fund retirement. Some simply hold the land idle in anticipation
of conversion to nonfarm use, as the region continues to lose
both farms and farm acreage. Bob Lievens says he has seen
the shake-out of apple producers at a rate of one or two each
year since he began working full-time at Woodmont in 1969.
The result, over the past decade, has been a decline of about
25 percent in the region's apple production. Frequently, the
decision to stay or sell is made when the owner retires or
dies, and sometimes it is dictated by estate taxes. Gould
Hill Orchards will almost certainly be taken over by Erick's
daughter or grandchildren one day. The future of Woodmont
is less certain. Bob and Stephen Lievens each have two children.
They hope that at least one of their kids will want to continue
in the family tradition.

THE VALUE OF OPEN SPACE

As the city has closed in on rural communities,
preserving farmland has taken on new urgency. Rather than
see farmers moving out when nonfarmers move in, many hope
that agricultural land will be increasingly intermixed with
commercial and residential areas.

Given the irreversibility of much urban
development, even city dwellers and suburbanites share this
sentiment. Some are concerned with protecting environmental
resources. Others hope to limit growth and preserve remaining
open space. Many consider the cultural heritage of farming
and the aesthetics of the New England farm, if not vital to
our regional character, at least crucial to the tourist trade.

The gist of these arguments is that agriculture
is important to New England beyond its narrow role in providing
food and other products. Open space and an attractive countryside
are highly valued by nonfarm neighbors -- in fact, these benefits
increase as the population around to enjoy them grows. But
they will be underprovided in the private market. Once made
available for one person, they are available to all, so even
those who cherish rural vistas will wait for others to supply
them. Farms' valuable environmental resources may also be
squandered unless developers and others are required to bear
the social cost of using them up. Thus, there is substantial
public support for programs that tax farmland at lower rates
or pay farmers for their development rights. It is not always
clear, however, if this support is for farming or for slowing
growth, as some studies suggest that residential development
may not bring in tax revenue sufficient to cover the additional
public services that are needed as a result.

Yet farmland preservation may not always
be the appropriate way to satisfy these varied and worthy
claims, for the goals of farmland preservation, preservation
of open space, and protecting the environment may not be easily
reconciled. Cows dotting the hill may make for bucolic surroundings.
But nonfarm neighbors often object to the farmer's penchant
for operating noisy machinery early in the morning or to the
smells of a nearby herd. The use of pesticides and fertilizers
also may create environmental problems, which become more
serious as the number of people living nearby, particularly
children, increases.

Farmland also may not be the only, or best,
way to provide open space. Land appropriate for hiking and
nature preserves may be unsuitable for commercial development.
Thus we could conceivably acquire land for recreation and
open space at a lower cost than by preserving farmland. But
in other instances, it is farmland itself that society values.
In Maine, for example, farms provide much-needed variety and
visual relief to a landscape that would otherwise be almost
entirely forest. And in the southern New England states, especially
Connecticut, almost all the remaining open land is farmland.

We might also consider whether our aim is
to preserve farmland or farming. If we want farmland, "rural
residences" may satisfy our need for open space, country
vistas, and visual relief. But if our end is preserving farming,
as an economic activity and as the site of a long legacy of
social and cultural traditions, then only working farms will
do.

SMALLER FARMS CHANGE THE LANDSCAPE Percent,
1992

New
England

United
States

Farms

Acres

Sales

Farms

Acres

Sales

Rural Residences
(Sales of less than $25,000)

67

41

5

63

22

5

Small Commercial
(Sales of $25,000-$99,999)

16

17

12

20

24

13

Larger Commercial
(Sales of $100,000 and above)

17

42

83

17

54

83

About four thousand
larger commercial farms account for most of New England's
agricultural sales, but smaller farms make a significant
contribution to the rural landscape. In this respect,
New England is similar to the national profile, which
averages states, such as North Dakota, that have a disproportional
number of larger commercial farms with states, such
as West Virginia, that have more smaller ones.

A farm is any establishment from which $1,000 or more
of agricultural products were sold or would normally
be sold during the year. Source: 1992 Census of Agriculture.

Policies to preserve
land in farming TAX PREFERENCES

Farmland in New England (and most other
states) is taxed at its value in agricultural use, rather
than at market value. This tax break reduces farmers' costs
and may delay conversion for those who wish to continue in
farming or hold agricultural land. But tax breaks have proved
no match for the profits from conversion in areas under intense
development pressure, and many analysts believe they have
only a small, long-run impact. Tax breaks also may imply higher
taxes or reduced services for others in the local community.
Some states spread the cost by using aid formulas that depend
on the taxable value of local property. Vermont has reimbursed
local communities for lost revenue, but recently suspended
the program when it became too expensive (it remains under
review, mired in a larger debate about tax policy). Still,
proponents contend that tax preferences, while no panacea,
help maintain farmers' incomes and are an important tool for
farm preservation. And they cite research showing that residential
development might not generate tax revenue sufficient to cover
the cost of additional city services.

PURCHASE OF DEVELOPMENT
RIGHTS

Both the federal and state governments and
private conservation trusts have set aside money to buy farmers'
rights to develop their property. This type of easement "runs
with the land," so future owners are also restricted
from converting to commercial or residential use. Many analysts
consider such programs more effective and less costly than
tax breaks. The government or trust can select the lands it
considers most important, and can decide if and when to resell
the rights later on. But the dollars in these programs are
relatively small. The federal government recently authorized
$35 million to be spent nationally over six years. In New
England, states have purchased rights to about 130,000 acres
since 1977, at a cost averaging from $500 to $6,500 per acre,
depending on the land's value in nonfarm use. Farmers also
worry that by reducing the value of collateral, they may limit
their ability to borrow in times of financial distress. Still,
for many, the sale of development rights is their last resort.

PRICE SUPPORTS AND SUBSIDIES

Agricultural subsidies have chiefly aimed
at maintaining farmers' incomes, but they may indirectly preserve
farmland. The largest subsidies go to states that produce
grain and livestock and receive the benefit of spending on
irrigation. In New England, milk and other dairy items are
the only major products subject to federal subsidy programs.
The U.S. Department of Agriculture sets minimum prices that
processors must pay dairy farmers. It also buys as much cheddar
cheese, nonfat milk, and butter as manufacturers want to sell,
at prices that return the support price to the farmer. Even
so, New England lost 40 percent of its dairy farms and 30
percent of dairy acreage between 1982 and 1992, although some
of these operations converted to other types of farming. In
an attempt to stem the tide, all six state legislatures recently
enacted the controversial New England Dairy Compact. The Compact
authorizes a Commission (including representatives of producers,
processors, and consumers) to set the regional price of fluid
milk above the federal level. Proponents argue that this will
preserve dairy farms and open space, without significantly
raising retail milk prices. Others disagree, contending the
Compact will lead to sharply higher milk prices and place
a disproportional burden on poor families, while failing to
halt the decline in New England's small dairy farms.